Credit Unions Are Reporting Triple The Amount of Growth
By Joyce Moed, Reporter

COLORADO SPRINGS, Colo.–CUNA is projecting credit union lending will wind up growing approximately 5% in 2008, but some credit unions are reporting triple the amount of growth than CUNA predicts.

"The biggest part of our growth has been in mortgage loans," said Bill Vogeney, SVP, chief loan officer at Ent Federal Credit Union, which is reporting 13% total loan growth for 2008. "In 2009, we'll probably have to slow that growth by selling them to Fannie Mae because of asset-liability concerns. We’re concerned about the continued pace of growth in mortgages compared to the regular portfolio."

Vogeney believes that credit unions nationwide did a great job in mortgage lending in 2008. He attributes that to the reduction in competitors credit unions now have. "A lot of lenders exited the business," he said.

The other reason Vogeney cites is that by reaching out to credit unions, borrowers could turn to a lender they could trust.

"For many, that meant turning to their credit union, when they may not have done that in the past," he said.

For Ent FCU specifically, Vogeney attributes their success in mortgage lending to the close relationship it developed with Realtors throughout the past few years.

"That helped us in 2008," he said. "The word has spread. We have real estate agents calling us with a sale pending because the lender has backed out. That word has spread among the Realtor community."

Vogeney reports that the 193,000-member CU’s auto loans have also grown faster than the national average.

"Three years ago we started sharpening our pencil," he said. "We’ve come up with some special financing plans."

The credit union has also been working closely with local Toyota, Honda and Subaru dealerships. "The more fuel-efficient dealers haven’t been affected as much," Vogeney noted.

In home equity loans, the credit union has also seen some growth in its portfolio this year.
"I attribute that to us having a really good sales culture here," Vogeney said. "I think we’ve got a good sales culture, and that’s helped us this year."

For other credit unions hoping to increase their loan growth, Vogeney said his words of advice is to remain as consistent as possible with credit policies.

"I’ve seen lending go through several changes," he said. "When times are good, they ease up credit. When bad, they tighten up dramatically. It’s only going to make your delinquency situation worse. My word of advice is to remain as consistent as possible. It’s really a fine line for credit unions right now."

Another factor that may be contributing to Ent FCU’s mortgage growth is its location.
In Colorado, the housing market is very close to be stabilized, Vogeney said.

"In May, June and July we actually saw some increases," he said. "We’re very consciously optimistic about our market. The question is how the economy will be, and how jobs will be. That’s the unknown."

www.ent.com